POTHANICAD FARMERS CO-OPERATIVE BANK LTD NO.3510 vs. THE CENTRAL BOARD OF DIRECT TAXES

WP(C)/4656/2020HC KeralaKLHC01012522202018 February 2020Author: HONOURABLE MR. JUSTICE AMIT RAWAL4 pages

AI SummaryRemanded

What did the High Court hold?

The High Court directed the third respondent, the Commissioner of Income Tax (Appeals), to decide the appeals (Exts.P2, P2(a), and P2(b)) in accordance with the law. This decision is to be made after providing the petitioner with an opportunity of hearing. Crucially, the court ordered that the appeals should be decided within a period of three months from the date of receipt of a copy of the judgment, and importantly, without insisting on the payment of 20% of the tax demanded, referencing a circular from 2017. Furthermore, the court ordered that recovery proceedings pursuant to the assessment orders should be kept in abeyance until a decision is taken on the appeals. The ratio decidendi is that appellate authorities should dispose of pending appeals expeditiously, and recovery can be stayed pending such disposal, with specific conditions regarding pre-deposit being considered in light of extant circulars.

What were the facts?

The petitioner, Pothanicaad Farmers Co-operative Bank Ltd., filed a writ petition before the High Court of Kerala seeking a direction for the disposal of its appeals (Exts.P2, P2(a), and P2(b)) before the Commissioner of Income Tax (Appeals) (third respondent). These appeals were filed against assessment orders (Exts.P1, P1(a), and P1(b)). The petitioner sought a directive for the expeditious disposal of these pending appeals. The respondents included the Central Board of Direct Taxes, the Income Tax Officer, and the Commissioner of Income Tax (Appeals). The assessment years are not explicitly stated in the provided text.

What were the issues?

1. Whether the High Court should direct the Commissioner of Income Tax (Appeals) to dispose of the pending appeals filed by the petitioner? 2. Whether the Commissioner of Income Tax (Appeals) should be directed to decide the appeals without insisting on the payment of 20% of the tax demanded, as per a 2017 circular? The petitioner argued for a direction to dispose of their pending appeals before the third respondent. The revenue, represented by the Standing Counsel, did not appear to have made specific arguments against the direction for disposal, but the court's order addresses the condition of paying 20% of the tax demanded. The judgment does not explicitly record arguments from the revenue regarding the core issue of appeal disposal itself.

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE AMIT RAWAL TUESDAY, THE 18TH DAY OF FEBRUARY 2020 / 29TH MAGHA, 1941 WP(C).No.4656 OF 2020(F) PETITIONER: POTHANICAD FARMERS CO-OPERATIVE BANK LTD NO.3510 POTHANICAD P O, KOTHAMANGALAM, ERNAKULAM-686671, REPRESENTED BY ITS MANAGING DIRECTOR IN CHARGE PAUL P VARGHESE. BY ADVS. DR.K.P.PRADEEP SMT.T.THASMI RESPONDENTS: 1 THE CENTRAL BOARD OF DIRECT TAXES DEPARTMENT OF REVENUE, MINISTRY OF FINANCE, GOVERNMENT OF INDIA, NORTH BLOCK, NEW DELHI-110001, REPRESENTED BY ITS CHAIRMAN. 2 INCOME TAX OFFICER, WARD -2, THODUPUZHA MAHIMA TOWERS, TEMPLE BYPASS ROAD, THODUPUZHA, IDUKKI, 685584. 3 COMMISSIONER OF INCOME TAX (APPEALS-2) KOCHI-T51, POORNUMA BUILDING, MANORAMA JUNCTION, PANAMPALLY NAGAR, KOCHI, ERNAKULAM-682036. BY SRI CHRISTOPHER ABRAHAM, STANDING COUNSEL THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 18.02.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No.4656 OF 2020(F) 2

JUDGMENT Petitioner has approached this Court seeking a direction to dispose of Exts.P2, P2(a) and P2(b) appeals preferred before the third respondent/Commissioner of Income Tax (Appeals) against the assessment orders Exts.P1, P1(a) and P1(b).

Having heard the learned counsel on both sides, the writ petition is disposed of with a direction to the third respondent to take a decision on Exts.P2, P2(a) and P2(b) appeals in accordance with law, after affording an opportunity of hearing to the petitioner, within a period of three months from the date of receipt of a copy of this judgment without insisting on payment of 20% of the tax demanded, as per circular of 2017. Till such time a decision is taken on the appeal, recovery proceedings pursuant to the assessment orders shall be kept in abeyance. AMIT RAWAL, JUDGE Skk//20022020

WP(C).No.4656 OF 2020(F) 3 APPENDIX PETITIONER'S EXHIBITS: EXHIBIT P1OF THE ASSESSMENT ORDER NO.AACAP7304H/2013-14 DATED 21.03.2016 ISSUED FOR THE YEAR 2013- 14 BY THE 2ND RESPONDENT. EXHIBIT P1(a)OF THE ASSESSMENT ORDER NO. AACAP7304H/2014-15 DATED 23.12.2016 ISSUED FOR THE YEAR 2014-15 BY THE 2ND RESPONDENT. EXHIBIT P1(b)OF THE ASSESSMENT ORDER NO. AACAP7304H/2017-18 DATED 19.12.2019 ISSUED FOR THE YEAR 2017-18 BY THE 2ND RESPONDENT. EXHIBIT P2OF THE APPEAL DATED 04.04.2016 FILED BEFORE THE 3RD RESPONDENT FOR THE YEAR 2013-14. EXHIBIT P2(a)OF THE APPEAL DATED 21.1.2017 FILED BEFORE THE 3RD RESPONDENT FOR THE YEAR 2014-15. EXHIBIT P2(B)OF THE APPEAL DATED 23.1.2020 FILED BEFORE THE 3RD RESPONDENT FOR THE YEAR 2017-18. EXHIBIT P3OF THE DEMAND NOTICE NO. PAN AACAP7304H/2013-14 DATED 17.05.2018 FOR THE YEAR 2013-14 ISSUED BY THE 2ND RESPONDENT. EXHIBIT P3(a)OF THE DEMAND NOTICE NO. PAN AACAP7304H/2014-15 DATED 19.11.2018 FOR THE YEAR 2014-15 ISSUED BY THE 2ND RESPONDENT. EXHIBIT P3(b)OF THE DEMAND NOTICE NO. PAN AACAP7304H/2017-18 DATED 19.12.2019 FOR THE YEAR 2017-18 ISSUED BY THE 2ND RESPONDENT. EXHIBIT P4OF THE STAY APPLICATION FILED ON 13.2.2020 BEFORE THE 3RD RESPONDENT IN EXT P2 APPEAL.

WP(C).No.4656 OF 2020(F) 4 EXHIBIT P4(a)OF THE STAY APPLICATION FILED ON 13.02.2020 BEFORE THE 3RD RESPONDENT IN EXT P2(A) APPEAL. EXHIBIT P4(b)OF THE STAY APPLICATION FILED ON 13.02.2020 BEFORE THE 3RD RESPONDENT IN EXT P2(b) APPEAL. RESPONDENTS' EXHIBITS: NIL

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